Union deal on downtown Sacramento arena prompts protest

Mayor Kevin Johnson had scarcely finished announcing an agreement designed to ensure peace with organized labor during construction of the new Sacramento Kings arena when the protest started – just feet from where he stood.

Kevin Dayton speaks out against the arena labor agreement announced Wednesday at Downtown Plaza as Mayor Kevin Johnson's press secretary, Ben Sosenko, reaches to take away the microphone.
hamezcua@sacbee.com

Mayor Kevin Johnson had scarcely finished announcing an agreement designed to ensure peace with organized labor during construction of the new Sacramento Kings arena when the protest started – just feet from where he stood.

Moments after the mayor hailed the deal at a Wednesday afternoon news conference, a Roseville political consultant named Kevin Dayton grabbed Johnson's microphone to denounce the agreement, which will steer the bulk of the $448 million project to union workers.

"Yes, there will be a fight," Dayton shouted. He was booed by dozens of hard-hatted union workers before the mike was pulled away a minute later by mayoral press secretary Ben Sosenko.

Dayton's outburst at Downtown Plaza, site of the proposed arena, could foreshadow the next phase of the controversy over the project. Eric Christen, head of a group that represents nonunion contractors, said his group would likely contribute money to the volunteer organization trying to force a ballot initiative that could derail the arena's proposed $258 million taxpayer subsidy.

"Our guys are furious about this," said Christen, head of the San Diego-based Coalition for Fair Employment in Construction, which has worked with Dayton. "Opponents of taxpayer funding for this arena just found an aggressive new ally today."

The "community workforce and training agreement" unveiled Wednesday was signed by lead arena contractor Turner Construction and the Sacramento-Sierra Building & Construction Trades Council. It contains a no-strike provision and would make sure union workers get most of the estimated 3,500 construction jobs.

While Turner would oversee hiring, and nonunion subcontractors are eligible to bid on jobs, workers would be dispatched by union hiring halls. All workers, union or not, would receive union-scale pay and benefits. The agreement also says 60 percent of workers and 70 percent of apprentices on the project will be from the Sacramento area.

"We want this to be a project with union jobs – that is a commitment we've all made," the mayor said. But he added, "There'll be some non-union opportunities to participate. That'll be the best of both worlds."

Dennis Canevari, president of the Construction Trades Council, said the agreement assures the delivery of "the skilled workforce required for this project."

Kings President Chris Granger applauded the agreement, telling the crowd at Downtown Plaza it will make sure the arena is open by fall 2016 – one year before the deadline imposed by the NBA. This "will provide us with great comfort and certainty," Granger said.

Such deals, often referred to as project labor agreements, aren't uncommon. The agency overseeing construction of the state's high-speed rail project has signed such an agreement, for instance. But the deals are controversial in some quarters; Placer County supervisors approved a ban on project labor agreements on publicly funded projects in 2010, and Christen's group was instrumental in getting San Diego County voters to pass a similar ban that same year.

In Sacramento, Christen's group spent $307,272 on a ballot initiative last year that would have banned a similar labor agreement for an NBA arena then proposed for the downtown railyard, as well as for other publicly funded projects, but it failed to collect enough valid signatures.

City records show that prominent developer Mark Friedman – a member of the new Kings ownership group – contributed $4,000 to that effort in August 2011. Friedman was unavailable for comment Wednesday.

The railyard project fell apart before a labor agreement was signed. The proposed arena has since shifted to Downtown Plaza, but Christen and other critics have the same complaint – that non-union contractors will be shut out.

Greg Anderson of Rex Moore, a major nonunion electrical contractor in Sacramento, said his company wouldn't bid on the project. The reason: Because all hiring comes out of the union halls, Anderson said he wouldn't be able to use his nonunion workforce.

Anderson said he and other nonunion contractors haven't finalized a strategy, but they dislike labor agreements so much that "we are opposed to the arena."

"It's not fair that anybody can monopolize the business,"said Ryan Valdez, 29, a Rex Moore electrician who was part of a small group of protesters at the mayor's announcement. "It's hard enough to find work."

Financial boost?

The union agreement could inject a new element of uncertainty into the arena project. STOP, or Sacramento Taxpayers Opposed to Pork, has struggled to gather signatures for its ballot initiative requiring a public vote on the city's arena subsidy. It was dealt a major setback in August after the revelation that the main funder of its petition drive was Chris Hansen, the hedge fund manager who tried to buy the Kings and move them to Seattle earlier this year.

Hansen gave the effort $100,000. When the state elections watchdog went to court to force him to disclose his contribution, he apologized and said he wouldn't give any more.

While Hansen's contribution harmed STOP's credibility, support from Sacramento building contractors could give the effort a fresh financial boost. STOP needs 22,000 valid signatures by December to put the issue on next June's ballot.

"Getting that money from Seattle kind of tainted it, but local contractors is another story," said Dayton, who runs an organization called Labor Issues Solutions.

Another nonunion contractors group, the Associated Builders and Contractors' Northern California chapter, also criticized the agreement and called on city officials to make sure other development projects proposed adjacent to the arena don't follow the same route. Nicole Goehring, government affairs director, said it wasn't clear if her group would donate to STOP as well.

"We want to support the (arena) project," she said. "We just don't want to be excluded from it."

"There's nobody going to rain on this parade," he said. "You're always going to have people on the fringes who don't agree."

'We're neutral'

STOP spokesman John Hyde said the group "will have to assess at the time whether it's in the best interest of this campaign" to accept any donations from Christen's group, which is based in the San Diego suburb of Poway.

"At this moment we're neutral on the issue of union vs. nonunion labor," Hyde said in an emailed statement. "For now, we are focused on our immediate goal, which is to qualify the petition for the June ballot."

Christen claimed that the arena labor agreement was signed to cement union support for SB 743, a bill proposed by area legislators led by Senate President Pro Tem Darrell Steinberg, D-Sacramento, that's designed to assist arena construction by streamlining court challenges under the California Environmental Quality Act.

"Steinberg needs union lobbyists and Democrats to push through his special CEQA exemption bill," Christen said. "Requiring construction companies to sign a project labor agreement with unions locks up majority support in the Legislature for this special-interest bill."

Although the city would still have to undergo the CEQA environmental review process, the Steinberg bill would shorten the timeline for court challenges from those opposed to the Sacramento project.

Steinberg wasn't at the Downtown Plaza announcement but told reporters at the Capitol: "I support project labor agreements because I think it is the way to assure labor peace, and at the same time incentivize high-wage employment."

Three environmental groups raised objections Wednesday to the Steinberg CEQA bill: the Planning and Conservation League, the Center for Biological Diversity and Sierra Club California.

"The streamlining provisions included in this bill combine to take away many of CEQA's important enforcement mechanisms," said Bruce Reznik of the Planning and Conservation League in a press statement. "Yes, the Kings need a place to play that meets NBA standards, but not at the expense of the environmental review process."